The official blog of Ignition Consulting Group
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-Pricing Strategy-
The U.S. Army has a policy of doing After Action Reviews (AAR), which take place after every training event. The Army has a saying they never want to build the same bridge twice. Professional knowledge firms should adopt that same practice at the end of every major assignment or client relationship. This is a particularly useful practice if your firm has a Chief Value Officer or Value Council …
Some of the biggest stars take the biggest risks when it comes to compensation by taking a percent of the box office. A good film makes more than a bad film, and the leading actors get paid accordingly …
The key to improving your firm’s profits is to improve its pricing. Nothing can improve your bottom line more than improving the price you get for your services …
As long as agencies are compensated as vendors they will likely be regarded as vendors. The truth is, many agencies are in fact paid like regulated utilities, with clients telling them exactly how much they can earn and what their maximum profit margin can be. That’s far from the spirit of a “marketing partnership” …
It surprises most agency professionals to learn that many clients are intensely interested in exploring a value-based compensation arrangement with their agencies. A recent position paper from the Association of National Advertisers (ANA) states it clearly: “Traditional metrics used in today’s cost-plus compensation agreements (usually based on time) have no relationship with the external value created for the client in today’s intellectual capital economy. Therefore, pricing should instead be based on results and value created” …
